The legal business form of the LLC, or Limited Liability Company, offers the benefits of several other traditional business forms. Limited liability is an advantage that the LLC shares with the corporation, but instead of being taxed as its own entity, it is treated more like a sole proprietorship or partnership for tax purposes. Like a corporation, a LLC can have unlimited shareholders, called members. But a key difference is if one of these shareholders dies or files for bankruptcy, the LLC is dissolved and will stop operations unless the remaining members form a new LLC. Many business forms have historically been aimed at the goal of limited liability, but the LLC is the most modern of these forms, having become popular since the enactment of laws in Michigan that authorized its formation.
Can My Business Be Formed as an LLC?
In Michigan, a business can be formed using the form that it chooses. Opening an LLC simply requires that the business founders file a form with the Secretary of State. Fees are often charged for opening LLC's, however, and Michigan law determines the costs for creating LLC's. In deciding whether you should organize as an LLC, you should consider carefully the applicable laws. Finding the right business structure for your company can lead to increased profits, but the process may take some time.
Can I Change the Form of My Business to an LLC?
Businesses in Richmond may sometimes change form. A company is eligible for conversion to an LLC if its situation falls under circumstances that are detailed by Michigan law.
How Can an Attorney Help?
A lawyer versed in Michigan business law will be able to advise you of the benefits and costs for forming and maintaining a LLC.